PM Abe's ruling party eyes big gains in low-voltage Japan vote

TOKYO, Dec 14 (Reuters) - Prime Minister Shinzo Abe's party
looks set for a huge win on Sunday in a low-voltage election
that will allow the conservative leader to claim a fresh mandate
for his reflationary policies to revive Japan's long-stagnant
economy.

Voting began at 7 a.m. (2200 GMT) for an election that the
premier has cast as a referendum on his "Abenomics" strategy to
end deflation and generate growth. Media exit polls, which have
proved reliable in the past, will come out at 8 p.m. (1100 GMT).

Abe called the vote after just two years in office in a
gamble originally seen as potentially costing his party seats.
But media projections have said his long-dominant Liberal
Democratic Party (LDP) could win more than 300 seats in the
475-member lower house, possibly its biggest victory since its
founding nearly six decades ago.

Together, the LDP and its junior partner are forecast to
keep their two-thirds "super-majority", ensuring the smooth
operation of parliamentary business.

Experts cautioned, however, that any mandate for Abe might
be smaller than first appeared since disaffected voters who are
increasingly dubious of Abenomics but wary of the opposition
could stay home in large numbers.

"This is not so much a vote of confidence in Abe and the LDP
as a vote of no-confidence in the political opposition," said
Columbia University professor Gerry Curtis.

Abe returned to power for a rare second term as premier in
2012 pledging to reboot Japan's economy, plagued by deflation
and an ageing, shrinking population.

But hopes for his "Three Arrows" of hyper-easy monetary
policy, government spending and reforms such as deregulation
were tarnished after the economy slipped into recession in the
third quarter following an April sales tax rise. Recent data
suggest any rebound is fragile.

Abe decided last month to put off a second tax hike to 10
percent until April 2017, raising concerns about how Japan will
curb its huge public debt, the worst among advanced nations.

But media forecasts suggest the main opposition Democratic
Party of Japan (DPJ) has been unable to gain traction, largely
due to voters' memories of a 2009-2012 rule plagued by policy
flip-flops, infighting and three premiers in three years.

LONG-TERM LEADER?

Abe, under the slogan "This is the only path", called the
election in a bid to strengthen his grip on power before
tackling unpopular policies, such as restarting nuclear reactors
taken off-line after the 2011 Fukushima disaster and a security
policy shift away from post-war pacifism.

The expected LDP victory could make it easier for Abe to be
re-elected in a party leadership race next September, boosting
the chance he stays in power through 2018 and becomes one of
Japan's rare long-term leaders.

Aside from local elections in April, his coalition will
probably not need to face voters until a 2016 election for the
upper house, where the LDP and the Komeito party now hold a
majority.

"If Abe wins big, he will at least have a free hand on
policy until the 2016 upper house election. The ability of the
administration to get policy through will increase a lot," said
Hideyuki Ishiguro, senior strategist at Okasan Securities.

Doubts, however, persist over whether Abe will now knuckle
down on his "third arrow" of reforms in politically sensitive
areas such as labour market deregulation that would make it
easier to shift workers to growth areas but also to lay off
employees, and reform of the highly protected farm sector.

Critics say progress has been limited so far, partly due to
opposition from members of Abe's own party.

"My personal assessment is that we are likely to see more of
what we've seen - piecemeal reforms moving more or less in the
right direction, but at a fairly slow clip and no bold
breakthroughs because of this election," Curtis said.

Some experts say Abe could also turn attention away from the
economy to his conservative agenda that includes laying the
groundwork to revise the post-war, pacifist constitution and
recasting Japan's wartime past with a less apologetic tone.

That agenda raises hackles in China and South Korea, where
bitter memories of Japan's past militarism run deep.

"If Abe forgets about economic policies and looks at self
defence and constitutional reform, this will be a big negative
for the market," said Makoto Kikuchi, CEO of Myojo Asset
Management.

The LDP had 295 seats and Komeito 31 in the 480-member lower
house when it was dissolved for the snap election. The DPJ had
62 seats heading into the poll. Five seats were cut through
electoral reform.
(Additional reporting by Thomas Wilson; Editing by Dean Yates)